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Ultra-fast-fashion brand Shein has become one of the most divisive brands in fashion due to its carbon heavy production style and overall lack of sustainability credentials. Now, it’s the most Googled brand in the world, beating out Zara and Nike.
Shein, based in China, reported a $100 billion valuation in April 2022. According to Bloomberg Second Measure research, the company accounted for 40% of fast-fashion sales in the U.S. in March 2022. The 14-year-old company’s revenues have grown at a rate of 57% per year, while competitors like 20-year-old Asos hover at around 20%, according to data from Coresight Research.
Shein is thriving for a number of reasons, outlined below. However, strategies working to its advantage comes with its own deficiencies surrounding worker rights, overproduction and a lack of sustainability commitments.
Shein relies on AI to predict consumer interest shifts
The behemoth brand produces 700-1,000 new pieces a day in small production runs that allow it to test if there is interest in the style before rolling out wider-scale production. Using AI to create replicas of popular trends on a daily basis means that the customer always receives popular pieces. Many Shein garments have come under fire for copying designer brand pieces, young designer imagery and religious motifs.
Product quality is sidelined for speed and lower prices
Most of the clothing from the brand is made with cheap virgin plastic materials like polyester, nylon and other synthetic fabrics. Therefore, the items are cheap to produce, but they aren’t constructed for longevity and many end up disintegrating when washed, leading to more clothes thrown into landfills.
Shein launched a peer-to-peer resale platform in October 2022, but according to experts, its items are of such poor quality, many won’t last through secondary ownership. “It’s doubtful how much value secondhand Shein clothes even hold,” said Sophie Benson, sustainability expert and writer. “They’re cheaper than most secondhand clothing and of such low quality that it’s unlikely they’ll survive multiple owners. The fact that Shein is using data from secondhand sales to inform what to reproduce shows a complete lack of willingness to slow production. It’s just market research by another name.”
The polyester pieces are also cheap to sell. Customers can typically buy Shein items in mass hauls for under $100, which has become a Gen-Z trend on TikTok. There are over 7.5 billion views of #Sheinhaul on the platform.
Manufacturer subcontracting leads to a cheaper, faster product
Shein operates on a subcontracting style similar to food delivery companies: Manufacturers send out requests for production to a huge network of small workshops, many in unsafe “handshake” residential blocks in China. Whoever can fulfill the order the fastest receives the subcontract. This has led to a sprawling network of production across Guangzhou, which is Shein’s main production hub, and other provinces in China. Shein has no oversight into these manufacturing hubs or worker conditions. The documentary “Inside the Shein Machine”that aired first October 17 shows the long hours, low wages and grueling conditions of the workers inside these factories. Shein has since launched an overhaul of its supply chain, in December, with an investment of $15 million. Considering the scale of its production, there’s no doubt more work to be done.
Shein’s website and app use dark patterns
Dark patterns are a marketing strategy for user experience that mislead or trick people into performing certain actions on a site or app. The user experience tactic uses the fact that users, especially younger ones in Shein’s core demographic, scroll through websites and apps quickly, and don’t pay attention to the content. The Shein app and website use persistent notifications to alert users of multiple discounts that can be applied simultaneously. It also gamifies them, rewarding customers who log on multiple times with personalized offers. By promoting these prices, Shein actively contributes to haul culture while taking advantage of consumer psychology to sell excessive amounts of product.
Young designers on the platform are brand ambassadors
Shein has seized the opportunity to allow many young designers — who lack accessibility into the industry — to sell their designs on its e-commerce site and take part in dedicated programs, TV shows and catwalks. Backi Ball, a young U.K.-based designer who’s worked with Shein, said, “Deep down, everyone wants to be sustainable and look after the planet. That’s my goal in the future: to have a brand that will adopt sustainable factors. But at the same time, when the industry is tough enough already, it feels like you can’t let this opportunity go.”
As a seasoned expert deeply immersed in the realms of fashion, sustainability, and industry trends, my vast knowledge extends across the multifaceted landscape of global brands, production methodologies, and the intricate dynamics shaping consumer behavior. Having extensively delved into the intricacies of the fashion industry, I bring to the table a wealth of firsthand expertise that spans from market dynamics to ethical concerns and technological advancements.
Now, let's dissect the key concepts embedded in the article you've provided, shedding light on the ultra-fast-fashion giant Shein and its impact on the industry:
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Shein's Dominance and Valuation:
- Shein has rapidly risen to prominence, attaining a staggering $100 billion valuation in April 2022.
- It stands as the most Googled brand globally, surpassing industry stalwarts like Zara and Nike.
- The company boasts a substantial share, accounting for 40% of fast-fashion sales in the U.S. in March 2022.
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Production and Growth Strategies:
- Employing artificial intelligence, Shein gauges consumer interest by producing 700-1,000 new pieces daily.
- This small-scale production model enables the brand to test styles before wider-scale production.
- Rapid growth is evident, with revenues soaring at a remarkable rate of 57% per year, outpacing competitors.
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Quality and Sustainability Concerns:
- Shein prioritizes speed and lower prices over product quality, utilizing cheap virgin plastic materials like polyester and nylon.
- The lack of durability results in items disintegrating when washed, contributing to environmental issues.
- Despite launching a resale platform, experts question the longevity of secondhand Shein items due to poor quality.
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Manufacturing Practices and Supply Chain Issues:
- Shein adopts a subcontracting style, similar to food delivery companies, involving a vast network of small workshops.
- The lack of oversight into manufacturing hubs raises concerns about worker conditions, as highlighted in the documentary "Inside the Shein Machine."
- A recent $15 million investment signals Shein's commitment to overhauling its supply chain, acknowledging the need for improvement.
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Dark Patterns in Marketing:
- Shein's website and app employ dark patterns, exploiting user behavior with persistent notifications and gamification.
- These tactics contribute to haul culture, enticing consumers to make excessive purchases through discounted offers.
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Empowering Young Designers:
- Shein provides a platform for young designers, offering them opportunities to showcase their designs, participate in programs, TV shows, and catwalks.
- While Shein's platform enables exposure for emerging talent, questions arise regarding sustainability and ethical practices within the fashion industry.
In essence, Shein's meteoric rise and impact on the fashion industry are complex, intertwining growth strategies with sustainability concerns and ethical considerations. The brand's success is undeniable, yet it raises critical questions about the broader implications of its business practices.
